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Mexican Bank of the Poor on Strike

January 14, 1998

MEXICO CITY (AP) _ Clutching a black plastic bag containing all her jewelry _ six rings and a few bracelets _ a desperate woman stood in front of a baroque building in downtown Mexico City, waiting for the huge wooden doors to swing open.

But the doors to Mexico’s ``Monte de Piedad,″ the national pawnshop that serves as so much more, haven’t opened in a month. They are closed by a strike, crushing the hopes of thousands of Mexicans who count on the 223-year-old institution to provide cash when things get rough.

And things are rough now.

With the Christmas season over, bills are coming due, and thousands of people who normally turn to the Monte de Piedad, or ``Mount of Pity,″ are left waiting.

``I need this money. I have to eat,″ said Aurrera Quintana, the 55-year-old market vendor who was waiting outside earlier this week.

It was the 12th time she had taken the hour-long bus ride from the northern slum where she lives to the pawnshop, only to be disappointed.

Like many Mexicans, Quintana doesn’t qualify for a bank loan. She is self-employed, so she has no pension, no benefits. When money gets tight, the Monte de Piedad is the only place she can turn.

``The banks will only lend you money if you’d already got some,″ Quintana said. ``People depend on the Monte, and now it’s closed.″

More than a pawnshop, the Mount of Pity is a national institution, where generations of families who live on the edge have gotten the money to tide them over in a bad month, to pay for a medical emergency, to stave off eviction.

Monte de Piedad branches in other cities also are closed by the strike. Though private pawnshops are open, few people trust them.

Lines often stretch around the downtown block where the Monte de Piedad has acted as lender of last resort since 1775. The pawnshop gives loans worth one-fifth to one-third of an item’s value at interest rates of 4 percent a month.

The institution, which has built up a $215 million fund, donates all of its profits to charitable organizations.

In a country where banking scandals and rapacious interest rates have made banks widely distrusted, most people still suffer from the 30-percent wage drop they received in the 1994 peso devaluation. Now, the crush of holiday bills is pushing them further toward the edge.

``This is the worst time of the year for this to happen,″ said Elisa Segura. She pawned jewelry before Christmas to pay for stock for her market stand. Now she can’t get it out.

``All our possessions are inside,″ she said.

The strikers, who stand outside the building alongside the people trying to pawn, say they want to help their customers, many of whom they know by name after years of service.

``We haven’t had a pay raise in two years,″ striker Cesar Vargas Velazquez said. ``For a supposedly charitable institution, they’re not very charitable with workers.″

Vargas Velazquez earns $6.75 a day as a guard at the Monte. Most of the 2,500 employees start at $4. Workers are demanding a 45-percent raise they say represents losses to inflation over the last two years.

Management _ a board of directors appointed by a charitable association whose members are in turn appointed by ruling-party city officials _ claims a series of hefty benefits, bonuses and seniority clauses have hamstrung plans to modernize the institution.

But the union charges that more than money is at stake. It says the nonprofit trust that runs the institution has squandered its money.

It cited a $2.9 million credit line to a dog shelter and a $750,000 donation to a government program to erect huge Mexican flags at key intersections in a bid to boost patriotism.

``These donations violate the statutes of the Monte de Piedad,″ said Eugenio Joel Gonzalez, leader of the employee’s union, ``as well as the spirit of the Monte, with so many poor people who need aid.″

Directors of the institution were not available to comment on the donations.

But in an August letter to local newspapers, fund President Alejandro Ainsle conceded that ``justice would suggest that these (flag) donations should be made only after we have seen to the needs of orphans, the elderly, the handicapped and hungry.″

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